Cala reports £100m profit in ‘above expectations’ first-half results

Cala Group has said it has made nearly £100m of pre-tax profit in the first six months of the year, up sharply on 2021 and ahead of management expectations despite the challenging economic environment.

The housebuilder, which is owned outright by insurance giant L&G, said it made £98m in pre-tax profit in the six months to June, up 26% on the previous year, on turnover of £688m.

The turnover was itself up 15% despite completions remaining broadly flat – rising by just 3% to 1,527 homes.

However, the business said it was on course to deliver an uplift in profit, turnover and unit volume over the full year in 2022, with 90% of expected sales already forward sold. It said it now expected to increase sales to more than 3,100 this year, which would represent a 7% improvement on 2022.

The firm did not give any detail of the impact of labour and materials cost increases on its business, beyond saying that sales price increases had offset increased build costs.

Kevin Whitaker, CEO at Cala Group, said the firm had delivered a “very strong performance ahead of forecasts for units, turnover and pre-tax profits.

However, he added: “Significant industry-wide supply chain challenges continue and I’m grateful for the hard work and expertise of our talented teams to deliver for our customers against this backdrop.

“Market demand has continued to support both strong sales rates and pricing, offsetting the ongoing construction cost inflation the industry is experiencing.”

Cala has previously set out a growth strategy designed to allow it to reach a revenue of £1.8bn by 2026.

“While wider economic factors cast potential uncertainty and negative sentiment, the market remains favourable and we are well placed for 2023,” Whitaker said.